NOTE 16. SEGMENT REPORTING

FASB guidelines establish annual and interim reporting standards for an enterprise’s operating segments and related disclosures about its products, services, geographic areas and major customers. In accordance with these guidelines, the Company’s four reportable segments are Mobile Modular, Portable Storage, TRS-RenTelco and Enviroplex. The Company's Chief Operating Decision Maker ("CODM") Joe Hanna, Chief Executive Officer, and senior management focus on several key measures to evaluate and assess each segment’s performance, including rental, rental related services and sales revenue growth, gross profit, income from operations and income before provision for income taxes. In addition to the evaluation of the aforementioned key measures of each reportable segment, the CODM and senior management evaluate supplemental information by reportable segment, such as rental equipment acquisitions, fleet utilization, and average utilization, to further assess segment performance and the future allocation of Company resources.

The CODM is the primary individual in control of resource allocation, and the allocation determinations are made in consultation with the Company’s senior management team, of which the CODM is a member. The most significant allocation determinations made by the CODM pertain to purchases of rental equipment and employee headcount. These determinations are generally made as part of the annual budgeting process, with regular reviews occurring throughout the year that can result in allocation changes depending upon performance against budget. On a monthly basis, the CODM considers period end and average rental equipment utilization and budget-to-actual variances to gross profit, income from operations, income before provision for income taxes and net income when making decisions about allocating capital and employee resources to the segments. Excluding interest expense, allocations of revenue and expense not directly associated with one of these segments are generally allocated to Mobile Modular, Portable Storage and TRS-RenTelco, based on their pro-rata share of direct revenues. Interest expense is allocated amongst Mobile Modular, Portable Storage and TRS-RenTelco based on their pro-rata share of average rental equipment at cost, goodwill, intangible assets, accounts receivable, deferred income and customer security deposits. The Company does not report total assets by business segment.

Summarized financial information from continuing operations for the years ended December 31, 2025, 2024 and 2023, for the Company’s reportable segments is shown in the following tables:





(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2025
Revenues
Rental revenues	$	326,919		$	67,593		$	109,406		$ —			$	503,918
Rental related services revenues		141,662			16,453			3,607			—			161,722
Sales		170,668			7,779			33,349			57,400			269,196
Other		5,879			989			2,531			—			9,399
Total revenues		645,128			92,814			148,893			57,400			944,235
Costs of Revenues
Depreciation of rental equipment		43,206			4,196			39,535			—			86,937
Rental related services		91,262			17,763			3,001			—			112,026
Other		88,122			7,361			22,826			—			118,309
Costs of sales		113,058			4,842			15,283			38,804			171,987
Total costs of revenues		335,648			34,162			80,645			38,804			489,259
Gross profit		309,480			58,652			68,248			18,596			454,976
Significant Segment Expenses 3
Wages and benefits		58,733			14,242			11,830			5,552			90,357
Depreciation and amortization		14,409			1,725			53			418			16,605
Marketing and administrative expenses		18,331			6,706			5,441			2,440			32,918
Allocated corporate services 4		50,292			7,313			12,001			—			69,606
Other segment items 5		1,046			589			232			—			1,867
Total expenses		142,811			30,575			29,558			8,410			211,353
Income from operations		166,669			28,077			38,690			10,186			243,623
Interest expense (income) allocation		24,990			3,603			4,611			(2,582	)		30,622
Foreign currency exchange gain		—			—			(80	)		—			(80	)
Income before provision for income taxes		141,679			24,474			34,159			12,768			213,081
Provision for income taxes		37,834			6,532			9,046			3,361			56,773
Income from continuing operations	$	103,845		$	17,942		$	25,113		$	9,407		$	156,308
Other Selected Information
Rental equipment acquisitions	$	100,363		$	4,584		$	43,904			—		$	148,851
Accounts receivable, net (period end)	$	182,540		$	11,299		$	26,877		$	11,149		$	231,865
Rental equipment, at cost (period end)	$	1,485,794		$	245,141		$	337,100		—			$	2,068,035
Rental equipment, net book value (period end)	$	1,098,720		$	219,038		$	103,140		—			$	1,420,898
Utilization (period end) 2		70.7	%		59.0	%		63.2	%
Average utilization 2		73.0	%		60.8	%		63.8	%


(dollar amounts in thousands)	Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2024
Revenues
Rental revenues	$	318,149		$	69,983		$	101,797		$ —			$	489,929
Rental related services revenues		127,589			17,702			3,207			—			148,498
Sales		183,234			5,695			27,531			45,830			262,290
Other		6,394			1,117			2,714			—			10,225
Total revenues		635,366			94,497			135,249			45,830			910,942
Costs of Revenues
Depreciation of rental equipment		40,399			3,982			43,886			—			88,267
Rental related services		83,547			17,267			2,605			—			103,419
Other		83,023			5,816			20,277			—			109,116
Costs of sales		124,886			3,551			12,426			33,862			174,725
Total costs of revenues		331,855			30,616			79,194			33,862			475,527
Gross profit		303,511			63,881			56,055			11,968			435,415
Significant Segment Expenses 3
Wages and benefits		57,741			13,812			10,368			4,859			86,781
Depreciation and amortization		13,712			1,432			107			383			15,634
Marketing and administrative expenses		17,276			6,102			5,342			2,323			31,043
Allocated corporate services 4		47,146			7,212			10,716			—			65,074
Other segment items 5		795			639			467			—			1,901
Total expenses		136,670			29,197			27,000			7,565			200,432
Other income, net		(6,220	)		(1,319	)		(1,742	)		—			(9,281	)
Income from operations		173,061			36,003			30,797			4,403			244,264
Interest expense (income) allocation		37,087			5,243			7,407			(2,496	)		47,241
Foreign currency exchange loss		—			—			215			—			215
Income before provision for income taxes		135,974			30,760			23,175			6,899			196,808
Provision for income taxes		23,320			6,403			2,424			1,771			33,918
Income from continuing operations	$	112,654		$	24,357		$	20,751		$	5,128		$	162,890
Reconciliation of Segment Profit
Total segment gross profit													$	435,415
Segment operating expenses, net														200,432
Other income, net														(9,281	)
Interest expense allocation														47,241
Foreign currency exchange loss														215
Gain on merger termination from WillScot Mobile Mini (Note 1)														(180,000	)
WillScot Mobile Mini transaction costs														63,159
Income before provision for income taxes														313,649
Provision for income taxes														81,922
Income from continuing operations													$	231,727
Other Selected Information
Rental equipment acquisitions	$	154,236		$	8,106		$	17,629			—		$	179,971
Accounts receivable, net (period end)	$	174,598		$	10,455		$	21,635		$	12,654		$	219,342
Rental equipment, at cost (period end)	$	1,414,367		$	240,846		$	343,982		—			$	1,999,195
Rental equipment, net book value (period end)	$	1,060,364		$	218,493		$	108,802		—			$	1,387,659
Utilization (period end) 2		75.1	%		59.8	%		58.6	%
Average utilization 2		77.5	%		64.9	%		57.3	%


(dollar amounts in thousands)		Mobile Modular			Portable Storage			TRS- RenTelco			Enviroplex1			Consolidated
Year Ended December 31,
2023
Revenues
Rental revenues		$	285,553		$	74,536		$	114,247		$ —			$	474,336
Rental related services revenues			114,511			20,510			3,139			—			138,160
Sales			155,267			4,587			27,119			20,192			207,165
Other			6,905			1,504			3,772			—			12,181
Total revenues			562,236			101,137			148,277			20,192			831,842
Costs of Revenues
Depreciation of rental equipment			36,921			3,514			48,477			—			88,912
Rental related services			75,390			18,568			2,670			—			96,628
Other			86,983			7,317			20,642			—			114,942
Costs of sales			105,021			2,858			13,884			15,964			137,727
Total costs of revenues			304,315			32,257			85,673			15,964			438,209
Gross profit			257,921			68,880			62,604			4,228			393,633
Significant Segment Expenses 3
Wages and benefits			55,795			13,607			10,074			3,901			83,376
Depreciation and amortization			13,511			1,613			108			337			15,570
Marketing and administrative expenses			15,935			5,866			5,398			2,228			29,427
Allocated corporate services 4			44,225			9,711			14,748			—			68,684
Other segment items 5			9,109			740			634			—			10,482
Total expenses			138,575			31,537			30,962			6,466			207,539
Other income, net			(2,329	)		(457	)		(832	)		—			(3,618	)
Income (loss) from operations			121,676			37,800			32,474			(2,238	)		189,713
Interest expense (income) allocation			29,724			4,950			8,146			(2,260	)		40,560
Foreign currency exchange gain			—			—			(310	)		—			(310	)
Income before provision for income taxes			91,952			32,850			24,638			22			149,462
Provision (benefit) for income taxes			23,379			8,472			5,899			(140	)		37,610
Income from continuing operations		$	68,573		$	24,378		$	18,739		$	162		$	111,852
Reconciliation of Segment Profit
Total segment gross profit														$	393,633
Segment operating expenses, net															207,539
Other income, net															(3,618	)
Interest expense allocation															40,560
Foreign currency exchange gain	`														(310	)
Income from continuing operations before provision for income taxes															149,462
Provision for income taxes															37,610
Income from continuing operations														$	111,852
Other Selected Information
Rental equipment acquisitions		$	176,200		$	27,967		$	28,945			—		$	233,112
Accounts receivable, net (period end)		$	175,360		$	16,057		$	25,511		$	10,440		$	227,368
Rental equipment, at cost (period end)		$	1,291,093		$	236,123		$	377,587		—			$	1,904,803
Rental equipment, net book value (period end)		$	967,712		$	217,315		$	144,296		—			$	1,329,323
Utilization (period end) 2			79.4	%		71.5	%		55.9	%
Average utilization 2			79.7	%		77.3	%		58.9	%

Gross Enviroplex sales revenues were $57,400, $45,832 and $22,615 in 2025, 2024 and 2023, respectively. There were no inter-segment sales to Mobile Modular in 2025. Inter-segment sales to Mobile Modular in 2024 and 2023 were $2 and $2,423, respectively, which have been eliminated in consolidation.

Utilization is calculated each month by dividing the cost of rental equipment on rent by the total cost of rental equipment excluding new equipment inventory and accessory equipment. The average utilization for the period is calculated using the average costs of rental equipment.

The Significant Segment Expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

Allocated corporate services costs are comprised of expenses incurred by the Company which are not directly incurred by each business segment as a part of their normal operations. These allocated indirect corporate costs primarily include wages and benefits, depreciation of corporate capital assets, information technology, legal, accounting and other administrative expenses.

Other segment items for each reportable segment is primarily comprised of credit losses.

No single customer accounted for more than 10% of total revenues during 2025, 2024 and 2023. Revenue from foreign country customers accounted for 2%, 2% and 3% of the Company’s total revenues for years 2025, 2024, and 2023, respectively. Mobile Modular purchased 27%, 18% and 30% of its modular units from one manufacturer during 2025, 2024 and 2023, respectively. TRS-RenTelco purchased 34%, 35% and 41% of its electronic test equipment from one manufacturer during 2025, 2024, and 2023, respectively. There were no vendor or supplier concentrations for Portable Storage and Enviroplex during years 2025, 2024 and 2023.

Historical Timeline

Fiscal Year	Filed
2025	Feb 25, 2026	Showing above
2024	Feb 19, 2025

2023	Feb 21, 2024

2022	Feb 22, 2023

2021	Feb 23, 2022

2020	Feb 23, 2021

2019	Feb 25, 2020

2018	Feb 26, 2019

2017	Feb 27, 2018

2016	Feb 28, 2017

2015	Feb 25, 2016

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

MCGRATH RENTCORP Segments Disclosure

Historical Timeline

About Segments Disclosures

Other Available Disclosures